Rochester Top 100: Company logs growth by grabbing market share

Genesee Regional Bank has more than tripled its deposits in the last five years and nearly doubled them in the last three.

Its assets have grown by 23.6 percent over three years, to $335 million in 2012, as the banking environment in Rochester and most of Upstate New York has been relatively flat.

"The reason for our growth over the last three years has been the same as it's been over the last dozen or so," said President and CEO Philip Pecora. "It's a market share gain.

"We've become better and better at serving the small-business community and their banking needs. It's really just picking off customers from our larger competitors, for the most part. That's really been our focus, frankly. That's why we've succeeded so much."

The bank subsidiary of Greater Rochester Bancorp Inc. also has steadily increased its workforce and will do so by 67 percent on Monday with the addition of 40 employees from First Rochester Mortgage Corp. The bank will assume the residential mortgage business of First Rochester Mortgage, increasing its workforce to 100.

A commercial bank, Genesee Regional initiated a residential mortgage business in 2007 and began promoting it in 2009 as headquarters moved to Linden Oaks Drive in Pittsford from 3380 Monroe Ave., which remains a bank branch.

The Linden Oaks site provides limited banking services. A second full-service branch is at 2300 W. Ridge Road in Greece. The Greece branch replaced the bank's original office and headquarters on Mount Read Boulevard in April 2009.

"Our focus continues to be on the Greater Rochester area and to continue to gain market share, really focusing our efforts on the commercial banking side," Pecora said.

"We got into the residential mortgage business probably about six years ago, and we've been doing OK, but this move here with the mortgage folks is obviously going to get us in in a much bigger way."

Hans Farnung, owner of East Rochester-based Beikirch Ammunition Corp., regularly does business with Genesee Regional. He became president and CEO of the firearms and hunting accessories business five years ago and bought the company in January 2011.

"I was with one of the big-name banks," Farnung said. "Sales were so-so, and I wanted to grow the business in a few different directions. I'd gone to that bank and asked for double the credit limit and told them what I was going to do with the money, and they were very reluctant."

Patrick Murray, a commercial banker at Genesee Regional, persuaded Farnung to switch banks, which he did in 2011.

"Genesee Regional stepped up to the plate and lined me up with the money I needed," Farnung said. "I doubled our sales within a year and a half in the East Rochester location."

He has since financed a second gun shop in Knoxville, Pa., and an archery shop in Elkland, Pa., through Genesee Regional. Both are doing good business, Farnung said.

"We bought a farm down in Jasper, N.Y., and they took care of that," he said. "They've got my mortgage for my home. I just got a new tractor for the farm.

"I can walk in there and everybody from Phil Pecora on down knows me by name. With the big banks, I was just a number. If I were still with that other bank, I'd still only have one place."

The greatest challenge for Genesee Regional is the same as with all banks: an increasingly difficult regulatory environment, largely because of the mortgage crisis and the economic collapse in 2008.

But the Great Recession and financial meltdown spurred the upcoming addition of First Rochester Mortgage.

"We're still held to pretty strict regulations, but a lot of those strict regulations hurt them more than they hurt banks," Pecora said. "From an industry standpoint, banking regulation is difficult, and it's costly."

Genesee Regional's roots go back to Lyndon Guaranty Bank of New York, founded in 1996 with a focus on commercial lending and limited deposit-taking.

Rochester entrepreneur Philip Saunders and local attorney Dante Gullace purchased the bank a year later, developing a small base of consumer deposits.